This week The Brazilian Report examines the effects of the sports betting boom in Brazil. Sports betting platforms and news sites have become dominant in Brazilian media. From broadcast television to social networks, it is impossible to go a day without seeing an advertisement from one of the scores of companies operating in the country.

As of last week, 108 companies (some with multiple applications) requested the Finance Ministry to officially start operating their brands in Brazil in 2025. Sports betting and other types of online gambling platforms were made legal in 2018, but as of January, only those complying with the new regulations will be allowed to continue operating. If all of them are authorized, the government will collect up to BRL 3.4 billion (USD 620 million) in concessions this year alone. More companies are expected to join this list in the following six months, when a new batch of analyses is set to happen.

The report explains how all those who receive the green light will have to promote campaigns on responsible betting and preventive measures to avoid game addiction. The adverse effects of the activity, however, seem to be rapidly getting out of control. Recent studies commissioned by retailers and different surveys with players paint a worrying picture that is far from being addressed by the regulations under implementation.

A survey of more than 2,000 players carried out this month by Instituto Locomotiva showed that almost half (46 percent) are between 19 and 29 years old, and 34 percent belong to families with monthly incomes of up to BRL 13,000 (or USD 2,400). Only 25 percent have higher earnings, meaning low-income users are prevalent in sports betting platforms. Worse, a third of bettors are in debt and have a bad credit rating. Even so, 37 percent have three credit cards, the most widely used payment method on betting platforms.

Hidden costs of Brazil’s betting frenzy

In July, another survey of over 1,300 people commissioned by a major Brazilian retailers’ association suggested that 63 percent have had their income compromised by betting losses, and 23 percent said they refrained from buying clothes to place bets instead. Even food retail may have been impacted by Brazil’s betting frenzy, with 19 percent of respondents saying they skipped a supermarket purchase to bet. Additionally, 11 percent said they did not purchase a healthcare service or medication due to betting.

The Brazilian Report highlights that while the government is set to benefit financially from the regulation of sports betting, the social costs are becoming increasingly apparent. The prevalence of betting advertisements and the ease of access to betting platforms have contributed to a rise in gambling addiction, particularly among young adults and low-income families. The new regulations mandate that companies promote responsible betting, but it remains to be seen how effective these measures will be in mitigating the negative impacts.

The report also focuses on the need for comprehensive strategies to address the adverse effects of sports betting. This includes not only regulatory measures but also public awareness campaigns and support systems for those affected by gambling addiction. As the industry continues to grow, it is crucial that the government and stakeholders work together to ensure that the benefits do not come at the expense of the most vulnerable populations.

While the sports betting boom in Brazil presents significant economic opportunities, it also poses serious social challenges. The Brazilian Report calls for a balanced approach that maximizes the benefits while minimizing the harms associated with this rapidly expanding industry.

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